Jeffrey Brice

Education: Bachelor’s degrees in accounting and finance, University of Wisconsin Eau Claire.

Age: 34

Family: Single

Most valuable lesson learned: Understanding how Silicon Valley works. You can’t write a business plan and get funding. That just doesn’t happen anymore. You have to have a product, you have to have traction, and you have to have it working. You can show this amazing market that you could conquer, but unless you have some numbers, they don’t care.

After holding his newborn niece in 2005, the first thing accountant Jeffrey Brice wanted to do was start a trust fund the whole family could contribute to for her future.

It didn’t take him long to discover that no such service existed, but it wasn’t until niece No. 2 arrived that the Madison, Wis., banker decided to do something about it. He started researching, wrote a business plan and submitted it to some people in Silicon Valley.

That was the beginning of what is now San Diego-based TrustEgg, a platform that allows anyone to start a crowdfunded trust fund for their child easily and without the usual minimum investment and management fee requirements.

Brice’s idea got him accepted into the high-profile accelerator Y Combinator, which counts among its alumni companies like AirBnB and Reddit.

After graduating from Y Combinator in 2011, he entered a regulatory black hole and finally launched his service in February 2013 after raising $1 million in funding. For the past year, he has been working out the kinks with a slowly growing customer base, and now is ready to tell the world about TrustEgg.

The company is also working with a foundation to expand a savings program for children of lower-income families.

We sat down with Brice to hear about making the transition from banking in the Midwest to launching a startup on the West Coast.

Q: What was it like moving to the Bay Area?

A: It was completely different. My background was in banking, where everything is very traditional and you don’t rock the boat. You get to Silicon Valley, and it’s the exact opposite. People saw me, an accountant from the Midwest, as kind of a fish out of water, but as far as what I was trying to do, I was the expert. That’s what helped me stick with it. People are used to startups jumping up right away. I understood the regulatory things that we had to get through, and I was patient.

Q: TrustEgg has a unique overlap of financial services and technology. What partners did you need to make it work?

A: When I first wrote my business plan, I realized that to do this, I needed a lawyer, and I needed an engineer. I happened to have a friend who was an engineer and finishing up law school. It’s the most uncommon combination. For the first year, he was doing all the research with me, he designed the first platform and went through the program with me in the Bay Area. Eventually, because this was taking so long, he had to go get another job, and I partnered up with someone down in San Diego that I had met at a conference.

Q: What did the funding process look like for you?

A: Fundraising is probably the most brutal part of a startup. In the beginning, the Y Combinator provided us with the seed money that got us through the regulatory hurdles and paid our legal fees. Then, we showed the minimum viable product and started looking to these angel investors — people who are going to put in a little bit of money at a time as you need it. This takes a lot of convincing when you don’t have anything up and running yet. They really have to believe. Once we had some traction and it looked promising, we raised a final round of financing so we could build this thing out.

Once we get to the next level of traction, then we’ll go to the venture capital firms and raise what’s called Series A. That really is what accelerates growth.

Q: Where did you find your investors?

A: The majority of the investors are from around the San Diego and Los Angeles areas. There are two major groups, the Tech Coast Angels and Harvard Business School Angels of Southern California.

Q: You’re doing something way outside the box in an industry that many people don’t have a lot of faith in anymore. How are they receiving you?

A: There’s definitely a trust factor with people hearing our brand for the first time, and there’s also a regulation issue. Over the past 10 years, there have been lots of problems with financial services. And there have been a lot of new regulations put in place that insulate current institutions, and it makes it harder for new ones to get in. So there’s extra hurdles we have to get over.

The big thing is, even though we’re completely legit and everything is in compliance, we still have to let everyone know it’s safe.

Q: Why do people want or need your service?

A: It’s difficult to find a trust fund that can be low-cost and doesn’t have a minimum. The big hurdle is that when you open up the trust account that we use, someone has to run the thing and handle all the paperwork.

If you do buy into the funds that you want, there’s a transaction fee every time you invest. For most people, if you want to invest $1,500 per year, it’s just not really cost effective unless you really know what you’re doing. We eliminate a lot of the paperwork, and eliminate a lot of the transaction fees.

You can go online and start your own account at Vanguard, but you’re going to have a $3,000 minimum. Three thousand doesn’t sound like a lot, but for most people, especially new parents, that might as well be $100,000. If I have to tell someone they have to start saving before they can start saving, it’s not going to happen.

Q: How does TrustEgg fit into the new crowdfunding ecosystem?

A: We think TrustEgg is going to be a catalyst. I think once we’re a little bit more mainstream, the startup world is going to catch on. People are going to see that so long as you put in a little work and do the regulatory stuff, you can out-innovate banks. That’s not the hard part. It’s the difficulty of getting in.

You need experience to do what we’re doing, but generally to get the experience, you have to be a little bit older, and you might have a family. You also don’t see people at the C-Level of a banking institution looking to take the big risks with their corporations.

I’m a little bit unique in that most accountants are risk-averse, and I just didn’t want to be 50 years old and mad that I didn’t try this idea. It was worth it to me, and I had the ability to really take that risk and drive across the country and give it a shot.